What is a Personal Loan EMI?
An EMI is the fixed monthly payment you make to the bank or lender to repay your loan. It consists of two parts:
- Principal – The original loan amount borrowed.
- Interest – The cost charged by the lender on your borrowed amount.
The EMI remains the same every month, but the share of principal and interest changes over time.
EMI on a ₹10 Lakh Loan for 3 Years
When you take a ₹10 lakh loan for 3 years (36 months), your EMI depends on the interest rate charged by the lender. Generally, personal loan interest rates in India range between 10% to 20% per annum.
Here’s an approximate EMI calculation:
| Interest Rate | Monthly EMI (approx.) | Total Interest Payable | Total Amount Payable |
|---|---|---|---|
| 10% | ₹32,270 | ₹1,61,720 | ₹11,61,720 |
| 12% | ₹33,215 | ₹1,95,740 | ₹11,95,740 |
| 15% | ₹34,665 | ₹2,47,940 | ₹12,47,940 |
| 18% | ₹36,165 | ₹3,01,940 | ₹13,01,940 |
(These are approximate figures. Exact EMI depends on lender policies.)
Factors That Affect Your EMI
- Interest Rate – Higher interest rates increase your EMI.
- Loan Tenure – Shorter tenure means higher EMI but lower total interest.
- Credit Score – A higher CIBIL score can help you get lower interest rates.
- Income Level – Lenders check income stability before approving a loan.
- Lender’s Policy – Different banks and NBFCs have different offers.
EMI Calculation Formula
The standard EMI formula is:
EMI = [P × R × (1+R)^N] / [(1+R)^N – 1]
Where:
- P = Loan Amount (₹10,00,000)
- R = Monthly Interest Rate (Annual Rate / 12 / 100)
- N = Loan Tenure in Months (36 for 3 years)
Most banks also provide online EMI calculators for quick results.
Tips to Reduce Your Personal Loan EMI
- Compare Lenders: Always check interest rates across banks and NBFCs.
- Improve Your Credit Score: A score above 750 increases chances of lower rates.
- Choose a Longer Tenure: This reduces EMI but increases overall interest.
- Part-Payment or Prepayment: If possible, repay a portion early to reduce EMI burden.
Who Should Take a ₹10 Lakh Personal Loan?
A personal loan is best suited for:
- Medical emergencies
- Education or study abroad expenses
- Wedding or travel plans
- Debt consolidation (credit cards, small loans)
- Home renovation projects
FAQs
Q1. What will be the EMI for ₹10 lakh personal loan for 3 years at 12% interest?
Around ₹33,215 per month.
Q2. Can I reduce my EMI after taking the loan?
Yes, by making part-prepayments or transferring your loan to a lender with a lower interest rate.
Q3. What is the minimum CIBIL score required for a ₹10 lakh loan?
Most banks require a score of 750+ for better approval chances.
Q4. Is it better to choose a 3-year or 5-year loan?
A 3-year loan has higher EMI but lower total interest. A 5-year loan reduces EMI but increases interest cost.
Disclaimer: This article is for general information only. The interest rates and terms mentioned in it depend on the policies of the bank and NBFC. These may change from time to time. Before taking any type of loan, get complete information from your bank.